A daily roundup of robo-advice news
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Market consolidation will mean that only a few robo-advisors will survive long term. This is the view of Morgan Stanley’s equity analysts, but the CEO of US robo-advisor Betterment, Jon Stein, agrees. “It’s the way things have gone in every other industry and during every other cycle in this industry,” he said.
Everyone knows that robo-advice is cheaper, smarter and less corrupt than traditional financial advice. So what’s holding robo start-ups back? Mostly customer acquisition, as it turns out. And the problem will likely get worse.
Academics are telling regulators to get better at examining algorithms and data before robo-advice takes off. Robo-advisors – like traditional advisors – are required by law to act in clients’ best interests. But a new study out of the University of Pennsylvania has cast doubt on regulators’ abilities to monitor this.
This article first appeared on www.roboadvicenews.com.
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